February 17, 2025
The U.S. oil and gas rig count increased for the third consecutive week, rising by two rigs to 588 as of February 14, 2025, according to Baker Hughes. Despite this, the total count remains 33 rigs (5%) lower than last year. The increase included one additional oil rig (481 total) and one additional gas rig (101 total).
U.S. drilling trends:
- The rig count declined by 5% in 2024 and 20% in 2023 as companies prioritized debt reduction and shareholder returns over expanding output.
- The EIA projects U.S. crude oil production to rise from 13.2 million bpd in 2024 to 13.6 million bpd in 2025 despite crude prices remaining stable.
- Natural gas production is expected to grow from 103.1 bcfd in 2024 to 104.6 bcfd in 2025, driven by a forecasted 73% rise in spot gas prices.
Regional highlights:
- Texas added two rigs, reaching 280 total.
- Oklahoma and Utah each gained one rig (44 and 13 total, respectively).
- North Dakota and Louisiana each lost one rig (32 and 30 total, respectively).
- Offshore rigs remained unchanged at 14.
- Canada’s rig count fell by 4 units to 245, but remains 11 higher than last year. Oil rigs declined by 3 (174 total), while gas rigs dropped by 1 (71 total).
Industry impact:
- SLB (Schlumberger) is restructuring and anticipating job cuts due to cost-saving measures and a cautious spending environment among its customers.
- The U.S. energy market faces concerns about oversupply, leading to moderate growth expectations in 2025.
In conclusion, the U.S. oil and gas rig count continues to see modest growth, marking its third consecutive weekly increase. While production is expected to rise in 2025, companies remain cautious due to concerns over an oversupplied market and fluctuating commodity prices. The industry’s focus on cost-cutting, efficiency, and shareholder returns suggests a tempered approach to expansion. Meanwhile, SLB’s restructuring signals ongoing adjustments in the oilfield services sector. As market conditions evolve, the trajectory of drilling activity will depend on price stability, demand trends, and broader economic factors.
